1. Financial Sustainability Concerns

The Social Security Trust Fund faces financial challenges due to an aging population and longer life expectancies. According to recent projections, the trust fund reserves may be depleted by the mid-2030s, leading to potential reductions in benefits if no legislative changes are made. This uncertainty makes it risky to depend entirely on Social Security for retirement income.

2. Inadequate Benefit Levels

Social Security benefits are designed to replace only a portion of pre-retirement income. For many retirees, especially those with higher lifetime earnings, the benefits may not be sufficient to maintain their standard of living. Relying solely on Social Security could result in a significant income gap that needs to be filled through other savings and investments.

3. Inflation and Cost of Living Adjustments (COLA)

While Social Security benefits do include annual cost-of-living adjustments, these increases often lag behind actual inflation rates, especially in critical areas like healthcare. This means that over time, the purchasing power of Social Security benefits may erode, potentially leaving retirees with less real income to cover their expenses.